Top 10 Tips: The Registration Gap

The Land Registry is reporting its longest delays in registrations in years. Some firms are reporting registration of transfers of part taking over 12 months.

The registration gap is the “gap” in time between the completion of a disposition and the date that the registration of the relevant disposition completes at the Land Registry. Until this point the buyer does not have legal title to the property acquired and is an owner in equity only. This note sets out key points to consider to try and reduce the risk of problems during the registration gap.

1. Think ahead

A lack of registered title can cause issues for both landowners and developers. Consider at an early stage whether planning or infrastructure agreements may be needed during the registration gap. Will relevant authorities require evidence of registered title, will they be selling part or all of the land after acquisition and need to deduce title to the purchaser(s), or is there a landlord with occupational tenants who needs to demonstrate their right to manage (and receive rent)?

2. Appoint the buyer as the seller’s agent

When negotiating the contract for sale, try to include additional clauses to appoint the buyer as the seller’s agent during the registration gap. This allows the buyer (without needing to get the seller involved), to serve notices, commence proceedings and take any other action in relation to the property until they are formally registered as the registered proprietor.

3. Oblige the Seller to enter into agreements during the registration gap

An alternative to appointing the buyer as seller’s agent, may be to oblige the seller to enter into planning or other required agreements that may be required prior to registration. The seller may agree subject to its costs being paid and an appropriate indemnity and other provisos being given.

4. Make sure OS1/OS2 searches are carried out

Ensure that prior to completion, official searches (OS1/OS2) are correctly carried out so the buyer’s application has priority over any subsequent applications. If the application is not submitted within the priority period the searches should be renewed in good time so protection is continued and no third party an register “ahead” of the buyer.

5. Submit applications to register promptly

Applications for registrations should be submitted asap following completion (the sooner they are in the sooner the Land Registry will start looking at them) and within the priority period.

6. Make sure the Land Registry forms submitted with the application are accurate

The majority of delays with registration arise from very simple errors in the Land Registry forms submitted with the application e.g. including the incorrect fee or incorrect execution wording. Applications should be double checked. Read the Land Registry Practice Guides!

7. Make sure all documents you need to submit with the application accompany it

Often documents the Land Registry needs to complete an application are missed out. For example, consent to registration for a restriction or a certified copy power of attorney under which a document is executed. Ensuring all documents accompany the application will reduce the chance of delay.

8. Respond to requisitions promptly

If a requisition in relation to an application is received, you should ensure that the deadline for responding is diarised and reply asap. The sooner you reply the sooner your registration is likely to be completed.

9. Make a request to expedite

If the landowner or developer has a future transaction soon after completion, the Land Registry offers a service where you can make an request to expedite (“fast-track”) a registration where a delay would (i) cause problems not related to a land transaction or (ii) put a property sale or other property transaction at risk, for example, a refinancing or development. You must provide evidence as to why this is required e.g. a copy of the future contract confirming the relevant completion date. The request for expedition is processed within 10 working days and takes your application to the top of the pile.

10. Use the Land Registry’s digital application service

The Land Registry is moving away from paper based electronic applications to fully digital applications. Applications will be quicker to create and process and that there will be fewer errors in the application due to automatic error checking (e.g. incorrect names or fee errors). The Land Registry (and we all) hope that this will lead to quicker registrations. This will be the default for all applications from 30 November 2022.